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Privacy advocates and online advertisers alike have long awaited a bill from Congress that will tackle the issue of behavioral advertising online. Today, Reps. Rick Boucher (D-Va.) and Cliff Stearns released (R-Fla.) a "discussion" draft of the bill (pdf here) that requires advertisers to allow consumers to opt-out of online tracking.

Considering that is already standard business practice, it appears that the online ad industry's efforts at self-regulation have been initially successful. But privacy advocates are not going to take this setback lying down.

Online advertisers, led by the Internet Advertising Bureau, have been frantically trying to prove that they are not abusing consumers' privacy online. New icons have been created to inform consumers of where and how their personal information is being used by marketers. The IAB has also been working overtime to inform consumers about how behaviorally targeted ads work. And it appears that their strategy is working.

The legislation draft requires marketers to allow opt-out options for consumers online. As opt-out policies are currently standard among online advertisers, that won't cause any radical shifts in the business of online advertising. But privacy groups are not pleased. According to Jeffrey Chester, executive director of the Center for Digital Democracy, during a conference call with reporters today:

“Consumer privacy groups are extremely disappointed that this bill maintains the status quo."

If the bill goes forward as proposed, it will allow advertisers to collect — and use for marketing purposes — personal information like name, address, social security number and even fingerprints, as long as users are given the ability to opt-out.

Furthermore, it would require websites to install the newly create privacy icons on all ads that depend on data collection and force advertisers to anonymize data collection after 18  months. Neither of those are drastic changes to current practices.

Regulators are trying to avoid crippling the rapidly growing online ad business, which is currently a $23-billion market. But the current bill may not go forward as proposed. Reps Boucher and Stearns posted the draft online to get early feedback. 

And already privacy advocates are preparing to oppose the bill and/or ask for major edits. As Evan Hendricks, editor and publisher of Privacy Times, tells Wired:

“It’s very Orwellian to call this a privacy bill."

Meghan Keane

Published 4 May, 2010 by Meghan Keane

Based in New York, Meghan Keane is US Editor of Econsultancy. You can follow her on Twitter: @keanesian.

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Comments (1)

Rebecca Caroe

Rebecca Caroe, B2B Business Development Specialist at CreativeAgencySecrets.com

Public education about behavioural advertising is all well and good, but it's hardly where the future will be. The increasing ability of the consumer to cut herself off from company advertising (in any medium) or only to solicit approaches in an RFP manner when she has a specific need, will become the norm. Take a look at Doc Searls' VRM and the rise of the Personal Data Store (Mydex.org or the Mine! project). This is a temporary stage in the development of online advertising as it moves to a trusted-agent-only environment where consumers include/exclude brands based on trust.

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